The Big Picture: The Economy

Wednesday, October 20, 2010

Joseph Stiglitz, winner of the Nobel Prize in economics, joins us for this week’s edition of our election series The Big Picture, to discuss the major issue of the midterm elections: the state of the economy. He’ll look at how the recession has played out, the economic solutions being debated on the campaign trail, and what policy changes would lift the country out of its economic slump. His latest book, Freefall: America, Free Markets, and the Sinking of the World Economy, has just been published in paperback.


Joseph Stiglitz

Comments [28]

amalgam from Manhattan by day, NJ by night

Case in point on why those "tyrannical" social democracies, especially Germany, are doing better than U.S. citizens economically and are smart, not reactionary (read: Tea Party) in their approach to cutbacks:

..."I pulled one of those Times articles in May when the Greek crisis was hot. The headline: 'Europeans Fear Crisis Threatens Liberal Benefits.' But you point out that when a country like Germany takes something away from the safety net, they usually balance it with a benefit.

Geoghegan: They cut back on holiday and they add a nursing home benefit. But the US press always focuses on the cutback. One of the reasons I wrote this book was to show that there's a leadership class over there that is very clever about these things. I don't mean in a spurious, tricky way, but actually thinking, "What do we have to cut back now so that we can go forward in the future?"

I love the U.S., but we gotta get with it.

Oct. 21 2010 03:52 PM

Enjoyed listening to Dr. Stiglitz. He has a lot to offer our country to get us out of this economic mess.

As a suggestion for future guests, please have economist Nouriel Roubini and banking analyst Chris Whalen on your program.

Thank you.

Oct. 21 2010 01:44 PM
jollyd from NYC

Mr. Stiglitz is always interesting.
Perhaps folks like Nolan from NJ could recommend a guest that they think represents an "oppossing" point of view. Do they mean an Austrian economist? or Sarah Palin?

Stop whining and learn to love the bomb.

Oct. 20 2010 03:22 PM
amalgam from Manhattan by day, NJ by night

@ Nolan from Deep in Central Jersey - Clearly you don't listen to Leonard Lopate on a regular basis, otherwise you would know that the show brings on economists and their analysis from a wide range of perspectives, including right-wing, laissez faire types like Niall Ferguson, etc. This is just one analyst and you it's your right to disagree. As far as I know, the majority of economists in the U.S. agree with you and not Stiglitz (who is not a strict Keynesian), so you can probably find a lot of economists that

Sometimes it's good to follow one stream of thought instead of the constant pitched battle that happens with the pro/con format. Think Charlie Rose.

@ anon from NJ/NYC Area - What about people like me that live in the same area and make $50K per year, yet take home about $40k? Should I feel bad for those that make $250k and take home $125k? I'm trying to get to the point where I can earn enough to to take home half of of that $250k. Sorry. I feel no pity for you.

Oct. 20 2010 03:13 PM
John Lamont from Atlantic Highlands, NJ

An interesting segment. I agree with other commentators who said an opposing, or different view would be welcome. What I'd really like to see is folks who are running for office in a discussion group with economists, historians and others who really know their subject matter. So tired of hearing from political talking heads.


Oct. 20 2010 01:24 PM
anon from NJ/NYC Area


Are families who are earning $250K in the NYC area (who take home around half of that) after they've paid for college tuitions and the country's highest real estate taxes/housing prices, really using what they have "left over" to buy several yachts and placing 3 flat screen TVs in each room? What a ridiculous little bit of pandering.

Guess you're going the way of cable news.


Oct. 20 2010 12:56 PM
Nolan from Deep in Central Jersey

Clearly Mr. Stiglitz is considered an authority of high regard on these topics. But it is clear that his position comes in line with our current administration and those who currently hold power. He claims that opposition is only about politics and not economics. Would you not serve your listeners by bringing in an opposing perspective. Stiglitiz is clearly a Keynesian economist, but it is by no means a proven fact that this perspective is correct. Even though he is an honored and accomplished economist that does not mean his ideas cannot be disputed. I find it disheartening that you bring him on and discuss the issues as if they are cold hard facts, as if it is absurd to question whether a bigger stimulus would have been more successful in saving the economy. It is clear to me that in your programming here and your guest have a specific agenda to push with no balance to dispute his ideas.

Oct. 20 2010 12:52 PM
Mike from Tribeca

Excellent, informative interview. Please have Mr. Stiglitz on again soon.

Oct. 20 2010 12:51 PM
LP from Murray Hill

Thanks for this important interview, Leonard.
It's really become evident we have a perfect storm of fiscal catastrophes: 2 hugely expensive wars paid for entirely on credit; the Republican insistance on lower taxes no matter what; reductions in regulation of banks allowing them to gamble with our money and create really poor real estate lending practices; and a business culture that insists on grabbing ever more for the few at the top at the expense of everyone else. How do we get out of this??

Oct. 20 2010 12:48 PM
Paula from nyc

thanks for a great segment.

Oct. 20 2010 12:45 PM
Henry Otaola Escobar from Elizabeth NJ

IMF saving latin-american countries????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????

'Could have never been so wrong.
Mr. Stiglitz, please...

IMF has only helped ruin those countries on the count of well... yes U.S.A.

A case study for you: Argentina (recovered AFTER LITERALLY KICKING OUT IMF and their economical recipes).

Oct. 20 2010 12:44 PM

Thanks for another good segment. I am wondering what Mr. Stiglitz thinks about the role of Fanny and Freddie in the mortgage debacle. It seems to me like the right-wing keeps trying to blame the whole economic crisis on that part of it.

Oct. 20 2010 12:38 PM
Opal from NYC

From the very beginning the Republicans were obstructionist. Where is job growth to come from when we import everything from China and elsewhere? When I shop everything is imported--an umbrella, clothes, even the new eco bulbs. When I need tech support, all the techs are from outside of the U.S.

Oct. 20 2010 12:37 PM
Bob from Avon-by-the-Sea, NJ

Please ask: Should we differentiate between "banks" and "private issuers"? Aren't 84.9% of the subprime mortgages from private issuers who were not under the control of federal regulations?

Oct. 20 2010 12:36 PM
j from bklyn

the other problem IMHO is that lack of manufacturing is based on the fact that R&D in this country has been lacking since the reagan administration started favoring the financial industry for nat'l economic policy as a leader at the expense of technological innovation.

Also, why "corporate america" seems to favor younger workers these days. maybe i'm missing something here, but if the older workers [over 40] have kids, isn't t-h-a-t your future consumer brand customer base? if you take care of the parents, you're taking care of the kids, and brand loyalty starts there. so retraining and upgrading older workers skills is actually to be thought of as an investment in your future customer brand loyalty consumer base.

Oct. 20 2010 12:34 PM
jgarbuz from Queens

Besides importing cheaper goods over the last forty years, America has also been "importing" third world immigrants, legal and illegal, and having to educate them. By contrast, during the 1930s and early 1950s, we were the recipient of many talented Jewish and other skilled immigrants who came with ready skills that helped boost the educational, scientific and artistic level of American society. But today we have to re-tool a worn down educational system that has been degraded over the last 40 plus years that is not producing the educated and skilled work force so necessary in the 21st century world economy..

Oct. 20 2010 12:33 PM
anon from nyc metro

When we measure productivity, we still include areas of the economy that pull money from other areas but contribute nothing in real value. Normally these would be called parasites. Economists seem to ignore this. The other thing that economist ignore is the failure of the "service as value" concept, despite the strongest possible refuation from manufacturing economies all over the world. The third area that economist get wrong is greed. When they suggest that employers will increase wages when they are able to decrease what the pay to health coverage will result, shows how out of touch they are with how things reall work and what kind of force greed is.

So, a modest proposal would be, lets get rid of the parasites, lets focus on developing ways to make us better at producing saleable goods, and lets stop paying attention to economists.

Oct. 20 2010 12:33 PM
Henry Otaola Escobar from Elizabeth NJ

Why don't we call things by their real name?


World's Economic Crisis: Capitalism/Neoliberalism's in its terminal phase -along w/ the human race-.

Oct. 20 2010 12:32 PM
Sarah Kim from Flushing

Maybe I'm in the minority here, but I think it's too early to reach any conclusions on the effects of TARP and the stimulus bill. When polling firms call and ask if I think Obama is taking the country in the right direction, I honestly have to say "I don't know." It will be another decade before we know what the longterm effects of this administration were.

Oct. 20 2010 12:32 PM
amalgam from Manhattan by day, NJ by night

Current European austerity measures are taking place in a context where those European citizens already receive a huge advantage in terms of governmental benefits in the face of downturns, layoffs, etc. If someone thinks that U.S. unemployment benefits, food stamps, and health care are too generous when the unemployed grapple with life minus work, then they should get a load of the Euro countries benefits. They aren't comparable.

So, even after Eurozone countries undergo austerity, their citizens still will receive so much more benefits from their (higher) tax dollars that it would make the die hard, laissez faire "libertarians" in the U.S. blush. No wonder the current economic deprivations in Europe aren't felt as bad, and no wonder Europe realizes (besides Greece and France) that they can afford austerity given their much lower poverty rates, etc.

Oct. 20 2010 12:31 PM
Janet from NYC

Please ask about the possibility for Stagflation.

Oct. 20 2010 12:28 PM
Phil Henshaw from way uptown

I keep telling people to look at the one central factor that explains nearly all the symptoms we are experiencing, that, not surprisingly, is not being mentioned by anyone in the public discussion at all. That's "environmental response".

It's that the environment stopped making growth ever easier for us, and started making it harder, actually starting in the 1960's... that directly explains why we have debt growing structurally faster than real earnings, and having people drawn into investing in bubbles, and etc. etc. etc.

I've been talking about it from a competent whole system view since the late 70's. What we need is people looking to the real world for answers, not theories for how to live in the past.

Oct. 20 2010 12:28 PM
Tom Crisp from uws

I heard on NPR just today that China's huge stimulus beginning in 2008 is a big reason they are recovering so well ...

Oct. 20 2010 12:25 PM
Adam from NYC

Please ask him why Goldman Sachs is still allowed to maintain its status as a bank holding company and borrow from the Fed at close to 0% but they don't offer any bank services to the public such as depository accounts or consumer loans.

Oct. 20 2010 12:17 PM

I just wanted to thank Stiglitz for making this subject both palatable and even enjoyable to someone with no background in economics!

Oct. 20 2010 12:17 PM
j from bklyn

what does Dr. Stiglitz think of Japanese economist Richard Koo's research and conclusion that in order for the US to come out of this recession based the Japanese experience, that the gov't has to supply a stimulus equal to the amount business's that are holding money back from investing in this country, in order to get jobs moving again.
And what rules/conditions would he apply in order to make in work? as in what could actually pass in congress, i guess.

Oct. 20 2010 12:16 PM


Mr. Stiglitz is not the first one to talk about Japan. If it is so obvious on how to avoid a lost decade:

1) What is Japan doing to turn it around. Why aren't they being more aggressive in fiscal policy

2) Why are the Europeans engaging in austerity

What are the counter arguments to a very aggressive fiscal policy

And, should we have nationalized the big banks?

Oct. 20 2010 12:12 PM
amalgam from Manhattan by day, NJ by Night

Well done, Leonard, to bring Mr. Stiglitz on the radio!

Contrary to the constant drone from mainstream, neoliberal (laissez faire) economists who have gained the ideological superiority in the U.S., and in much of the globalized world, among the many so-called libertarians, corporatists, and free marketeers, there are economic alternatives apart from the old communist-capitalist-Keynsian debates.

I think Mr. Stiglitz can help move us into new ways of ordering our economy that better reflect how we live and conduct business.

Oct. 20 2010 10:29 AM

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